Bart De Moor, Head of our Insolvency and Restructuring practice, and Angélique Daponte, Associate in our Insolvency and Restructuring practice, published an article in the journal Insolvency and Restructuring International.

The article is entitled "Transposing the new EU Restructuring Directive into Belgian law, focusing on debt-to-equity conversions”.

In the ordinary course of business, shareholders bear the entrepreneurial risk. Indeed, they risk losing everything they have invested in their companies if these companies become insolvent. Should their companies be turned around through a judicial reorganisation by way of both collective and amicable agreement, the entrepreneurial risk has been diverted to the creditors and replaced by their efforts to make concessions in respect of their claims. In this situation, the shareholders retain all their equity and gain back a healthy, valuable company should the procedure turn out to be successful. The new European Union directive encourages the prevention of the aforementioned risk diversion to creditors by allowing the inclusion of debt-to-equity conversions in restructuring plans and by sidelining dissenting shareholders. Nevertheless, awaiting the transposition of the EU directive, current Belgian company law provisions make it almost impossible to include such debt-to-equity conversions in restructuring plans.

Read the full article "Bart De Moor and Angélique Daponte, Transposing the new EU Restructuring Directive into Belgian law, focusing on debt-to-equity conversions, Insolvency and Restructuring International, October 2021” here : https://www.ibanet.org/insolvency-restructuring-international-october-2021